Understanding India’s Interest in the South China Sea: Getting into the Seaweeds

The Indian Navy chief, Admiral D.K. Joshi, has staked India’s claims in the waters of the South China Sea much more powerfully than the government by recently suggesting that with the security of the nation’s economic assets at stake in South China Sea, “we [the Indian Navy] will be required to be there and we are prepared for that.” He made it clear that the Indian Navy had been exercising for such an eventuality even though governmental approval would be needed if the navy is to provide protection to India’s economic assets in the South China Sea.

This elicited a predictably hard reaction from Beijing with China’s Ministry of Foreign Affairs spokesman Hong Lei responding that India should respect its sovereignty and halt its oil and gas exploration. Lei underlined that “China has indisputable sovereignty over the Nansha Islands and their adjacent waters” and that it “opposes unilateral exploration and development of oil and gas in contested waters of the South China Sea.” This exchange comes at a time when China is escalating tensions in the region with its decision to empower the police in the Hainan province to board foreign ships and seize vessels in the disputed waters of the South China Sea. The rules will come into effect January 1, and the police will be able to take necessary measures to stop ships or “to force them into changing or reversing course.” It is in Hainan province that India’s ONGC Videsh Ltd (OVL) has been given the oil block number 128 by Vietnam for joint exploration.

The conflict between India and China over the South China Sea has been building up for more than a year now. India signed an agreement with Vietnam in October 2011 to expand and promote oil exploration in the South China Sea and then reconfirmed its decision to carry on despite the Chinese challenge to the legality of Indian presence.

By accepting the Vietnamese invitation to explore oil and gas in blocks 127 and 128, India’s state-owned OVL, not only expressed New Delhi’s desire to deepen its friendship with Vietnam, but also ignored China’s warning to stay away. After asking countries “outside the region” to stay away from the South China Sea, China issued a demarche to India in November 2011, underlining that Beijing’s permission should be sought for exploration in blocks 127 and 128 and, without it, OVL’s activities would be considered illegal. Vietnam meanwhile had cited the 1982 UN Convention on the Law of the Sea to claim its sovereign rights over the two blocks being explored.

India decided to side with Vietnam’s claims and ignore China’s complaints. China has been objecting to Indian exploration projects in the region, claiming that the territory comes under its sovereignty. Whereas India continues to maintain that its exploration projects in the region are purely commercial, China has viewed such activities as an issue of sovereign rights.

India’s moves unsettled China, which views India’s growing engagement in East and Southeast Asia with suspicion. India’s decision to explore hydrocarbons with Vietnam followed a July 2011 incident during which an unidentified Chinese warship demanded that INS Airavat, an amphibious assault vessel, identify itself and explain its presence in the South China Sea after leaving Vietnamese waters. Completing a scheduled port call in Vietnam, the Indian warship was in international waters.

After an initial show of defiance, India showed second thoughts. Earlier this year in May, India’s junior oil minister told the Parliament that OVL had decided to return block 128 to Vietnam as exploration there wasn’t commercially viable. Hanoi publicly suggested that New Delhi’s decision was a response to pressure from China. In July 2012, after Vietnam gave OVL more incentives in terms of a longer period to prove commercial viability, India decided to continue the joint exploration. Vietnam decided to extend the OVL contract for hydrocarbon exploration in block 128, reiterating that it valued India’s presence in the South China Sea for regional strategic balance.

In June 2012, state-owned China National Offshore Oil Company, or CNOOC, opened nine blocks for exploration in waters also claimed by Vietnam. Oil block 128, which Vietnam argues is inside its 200-nautical-mile exclusive economic zone granted under the UN Law of the Sea, is part of the nine blocks offered for global bidding by CNOOC.

By putting up for global bidding a Vietnamese petroleum block under exploration by an Indian oil company, China managed to force India into a corner. That India would not be intimidated by Chinese maneuvers came during the July ASEAN Regional Forum in Phnom Penh. There, India made a strong case for supporting not only freedom of navigation but also access to resources in accordance with principles of international law. New Delhi, which so often likes to sit on the margins and avoid taking sides, must assume it can no longer afford the luxury of inaction if it wants to preserve credibility as a significant actor in both East and Southeast Asia.

The Indian Navy chief’s remarks have underlined New Delhi’s ambitions to expand its footprint in the region, which has so far been viewed as outside India’s core interests. At a time when China’s bullying behavior has been evident in its actions and pronouncements, India is signaling that it is ready to emerge as a serious balancer in the region. The regional states have often complained about Indian diffidence and its lack of seriousness. Now India is getting more involved, though it is still not clear if it is well prepared to take on China. Apart from the fact that Indian military modernization lags far behind that of China, the Indian government needs to urgently articulate when and under what conditions it would it be willing to use its military assets. This is important not only to bring the armed forces and their civilian leaders in sync with each other but also to make the Indian military fit to tackle the tasks set by the policy objectives of the government.

Harsh V. Pant is an adjunct fellow (nonresident) with the Wadhwani Chair in U.S.-India Policy Studies at the Center for Strategic and International Studies (CSIS) in Washington, D.C.

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Harsh V. Pant